Margins are tight for Hospitality businesses – fact.
One of my friends in Contract Catering said to me “every penny’s a prisoner” years ago. I’ve never forgotten this phrase, and it still rings true today. This means it’s a continuous process for Operators and Business Owners to find the balance between having the right produce, at the best possible price, with the objective being to maximise those tight margins.
How E-procurement can help
E-procurement platforms have been developed to help solve this continuous problem, promising transparency and control of the price that businesses are paying for goods today. Sounds great, right? Who doesn’t want to have full confidence that the live data is accurate, and that this data will add value when next negotiating with suppliers? Be careful that the control of live price and your sales margins doesn’t hurt your bottom line elsewhere. This is a consistent conversation that we have when meeting new clients, who have had their fingers burnt by costs that they simply weren’t expecting, so hadn’t budgeted for. Good luck explaining that to your CFO!
Best to check you have full transparency of all of the costs associated with your shiny new e-procurement platform. Our clients have reported some concerning challenges with other platforms on the market. If a provider confirms that there are no set up costs, check that you aren’t actually paying for the setup costs over time with a 20p per invoice added. Look out for similar charges for invoice scanning (these really mount up over a 3-year contract). Wouldn’t life be easier if there was no need for scanning invoices into your Finance software, so no charges? We think so too.
Also, check that your suppliers (who you’ve built a long-term relationship with) aren’t being charged a monthly maintenance fee and set up costs. Guess who will pay for these hidden fees over time? Yep, that’ll be you.
Free to suppliers
The solution – a free to trade platform for all sized suppliers to trade in real time with you. Easy to set up and maintain for you and your suppliers, with no extra fees. Sounds simple, doesn’t it? We believe it should be so that you can focus on growing your business with savings that you can believe in. We don’t charge suppliers for the privilege of trading with you as we see this as unethical. We believe that you and your suppliers should both benefit from online trading, so that’s what we do.